The International Monetary Fund could offer Moldova USD 117 million in response to the authorities request for IMF emergency financing assistance to mitigate the economic impact of COVID-19. The IMF mission, led by Ruben Atoyan, will hold discussions from the IMF Headquarters in Washington, D.C. during March 30 – April 1 on economic policies appropriate for addressing the impact of the pandemic under the blend RCF/RFI, IPN reports.
A press statement of the IMF Resident Representative in Moldova Volodymyr Tulin says that financing under the RCF/RFI is subject to Executive Board approval and does not involve ex post conditionality or reviews. In case of Moldova, the blend RCF/RFI can support an outright disbursement of up to SDR 86.25 million (equivalent to USD 117 million, or 50 percent of quota), paid out in an expedient manner.
The IMF has two facilities – the Rapid Credit Facility (RCF) created in 2009 and Rapid Financing Instrument (RFI) set up in 2011 – that provide emergency financial assistance to member countries without the need to have a full-fledged program in place. These loans can be disbursed very quickly to assist member countries implement policies to address emergencies such as the coronavirus.
Financing under the RCF, available to low income countries, carries a zero interest rate, has a grace period of 5½ years, and a final maturity of 10. Financial assistance provided under the RFI is subject to the same financing terms as the Stand-By Arrangement (interest rates are currently about 1½ percent), and should be repaid within 3¼ to 5 years.
